FASTER FOOD....

FASTER FOOD SERVICE

Most hotels have inadvertently conceded comparative advantage of food and beverage to the fast food chain popularly and wrongly referred to as eateries. Before the emergence of fast food chains there were just two extremes of food and beverage outlets -the hotel restaurant and the very local eating outlet that litter the streets known as Bukas.

The needs and demands of the middle class coupled with increased speed of commercial activities and lifestyle necessitated the birth of fast food for a restless and mobile society.  From their humble beginning as corner shops, they have metamorphosed into luxury and conspicuous outlets that have come to stay.  Initially, their strength was in the ability to churn out food on the go compared to a la carte service in the hotel. Customers’ inability to eat in the outlet used to be their sole weakness and that has since been taken care of. Most fast food outlets now provide restaurant seating arrangements where customers can eat and dine in an ambience of restaurant without taking loan.

The number of fast food chains quoted on the stock market indicates who has the market advantage in the industry. In comparison; their overheads are almost nil, meals are hot and spicy, menu is simple and service is down to earth. In return, return on investment is healthy and the prospects of expansion are limitless. No wonder they are ubiquitous!

Strategically, their paternal parents -the hotels have not been able to testify of similar prospects in spite of their structural advantage and financial standing. While it may seem preposterous to question the culinary skills of the various chef and cooks in the hotels, the burning facts on the ground indicate loss in the department. The complaints are similar in nature but different in expression. Most hotels restaurants are like our kids; they are proficient in foreign language and can hardly pronounce a word in their mother's tongue. You can hardly get Nigerian dishes prepared to taste in our restaurants. In house guests will rather visit Buka or fast food outlet for local delicacy than wait two hours for local meal that will taste foreign in a decent hotel restaurant. Menu prices are understandably higher and that is the more reasons why guests must get value for their money. 

The over reliance on rooms revenue has further relegated food and beverage department to an ancillary level where their proceeds has reduced them to service department. If you factor the cost of bringing a guest to stay in the hotel into cost of guests’ maintenance and less the loss revenue derivable from food and beverage department, then compare to the room revenue actual. What you are likely to have is what we have now. Ineffectual department.  Rather than consult a consultant to initiate a strategic approach to management of the department, the hotels owner pressed the panic button by either outsourcing the department to another body or continue raking up loss and making it up with other minor revenue generating sections. 

In above context, either alternative is not recommended. Outsourcing on its own and in different settings is viable but entrusting such a department in the hands of a body that may not necessarily share your vision and passion may be counterproductive. Similarly, deciding to hold on to the department doing the same thing will not yield different results but rather contaminate other departments with its burden and financial liability. There is also this other extreme option fashioned after fast food that some hotels are exploiting. It is called cafe. It's built and designed to have the characteristics of fast food and embedded in the hotel. Sadly, for reasons beyond this piece, this initiative has simply refused to fly.

Shall we then resign to fate and hand over the initiatives to the fast food outlets while the hotels bemoan their sad situation. Or simply allow the laws of comparative advantage to take its course? While some quarters in the industry have favoured the hotels concentrating on rooms and other service departments as their core competencies and leaving food to fast food chains, methinks this is the most lethal of all options. What happens if the fast food chain arising from their monumental success in the food and beverage department decides one day to annex rooms division department?

It’s true that we are in the same industry and the essence of this article may be lost on you. But before that happens, it is pertinent at this point to reiterate that this piece exposes the fast food outlet as a downstream sector of the industry where investors with minimal fund can play and emphasizing the need to shore up revenue in the food and beverage department by rising up to the healthy rivalry the fast food chains are serving.